Creditors Voluntary
Liquidation
UNDER FINANCIAL PRESSURE?
When you first contact us we will assess your finances and explain the options open to you. It is probable that liquidation will be the solution as this is the most likely route directors choose to take because it is quick, cost effective from £3,000 + VAT and does not stop you starting a business again. It also usually does not affect your personal credit rating.
The main alternatives to liquidation are a Time-to-Pay Arrangement, Administration or a Company Voluntary Arrangement. This page goes on to talk about liquidation. You can find out about the other options by calling us or searching our website.
How to close an insolvent limited company
We can do everything to liquidate your company online.
Usually, the quickest and cheapest method to close a company with debts is liquidation. This process is called Creditors Voluntary Liquidation or “CVL”.
This decision to liquidate is taken by a majority of the company directors at a meeting.
The whole process from instructing your insolvency practitioner, to the date of liquidation usually takes about 10 to 14 days.
Liquidation does write off any Bounce Back Loans as they are not personally guaranteed. this is one of our most frequently asked questions with regards to the Creditors Voluntary Liquidation process.
Everything to liquidate can be done online and we send you the paperwork to sign via Adobe Sign, so you have your own copy. There is no need to print any documents and post them to us.
Positives of Liquidation:
- It is quick – usually 10 days.
- It is relatively cheap.
- There is usually no creditors meeting.
- There is no need to finish accounts or VAT/PAYE returns anymore.
- It allows employees to claim redundancy from the UK Government fund.
- It writes off unsecured creditors like bank Bounce Back Loans, CBIL’s loans below £250,000, suppliers, VAT, PAYE and other liabilities like business rates.
- It does not automatically stop you being a director of another company.
- We take over and manage all of the creditors for you.
Negatives of Liquidation:
- It does not clear creditors who have a personal guarantee like Funding Circle.
- All of the company assets are used to pay back the company creditors, so shareholders are unlikely to get paid.
- If you owe the company money you will be forced to pay it back.
What Happens Next?
We will send you a list of what we need. This includes a list of creditors, assets, employees and other financial information we need.
If you want to see the list as a PDF CLICK HERE.
If you’d like to discuss anything you can call us, we can arrange a virtual meeting or a meeting at our office or your premises. We then agree with you the target date of actual liquidation – usually within 7 plus days. We then prepare all of the paperwork for the directors to sign. As liquidation is a three-stage process this paperwork includes:
- The directors meeting to decide to liquidate.
- The notices to shareholders.
- The notice to creditors.
The notice to creditors is for a deemed consent liquidation. This means there is no creditors meeting – although creditors can request one if more than 10% want a meeting. The meeting can be a video call or in person.
We prepare a report to creditors and shareholders to send out before the date of liquidation. We publish this report online with access by a password only.
We take the pressure off you during this period and deal with your creditors. We also help the employees make their redundancy claims from the Government.
The company then goes into liquidation on the target date.
The First Few Months
After the company has gone into liquidation, we carry out the following tasks:
- Close any premises.
- Collect any business records.
- Collect in any assets such as equipment, stock, and debtors.
- Close the company bank accounts.
- Help employees make their claims for unpaid salary and redundancy from the Government.
- Agree creditors’ claims.
- Make a report to the Insolvency Service.
Our usual aim for a less complex liquidation is to close the case and have paid out any creditors by the anniversary date.
If you would like to know more about the five stage process over the life of a liquidation please download this TWO PAGE GUIDE or have a quick look at the two minute video below.
Creditors Voluntary Liquidation (CVL) Costs
CVL is a relatively cheap process compared to other insolvency routes such as Administration or a Compulsory Liquidation which may involve legal fees.
Kirks charge a fixed fee to liquidate the company of between £3,000 to £5,000 plus VAT (depending on complexity) and can be paid using company assets.
The lower end of the fee rate is charged for smaller companies with no employees and only a few creditors.
We or your chosen Insolvency practitioners are paid post liquidation (using company assets).
The Next Stage
Please contact us with any questions you have or if you would like to arrange a call or meeting.
David Kirk says:
“We provide a nationwide service and take care of everything. We act quickly and are helpful and supportive. We return your emails and telephone calls.”
You can also email David direct if you have any questions on david@kirks.co.uk
We offer quick liquidation for your business. Contact us directly to find out more.
david@kirks.co.uk
Phone
0808 1961496
Offices
Across the South West, London & Wales
Reviews
“They promised a straightforward process and certainly delivered – I highly recommend the team at Kirks.”
Danielle F
“Kirks offered a cost-effective and reliable service. They were responsive to any queries/issues in the winding-up process – thank you.”
Patrick T
“A fixed fee arrangement provided us with reassurance and David explained the process clearly to us at the outset. A very professional service all round.”
David M
“Kirks provided a very efficient and cost-effective service. They offered support and advice throughout the process and made prompt payments. It was a very professional and helpful service.”
Richard T
“I had already met with a number of other insolvency practitioners none of whom I considered to be as clear cut and up front as David. The liquidation was executed quickly and professionally and I really am happy.”
Anon
Creditors Voluntary Liquidation: Step By Step
Where the directors decide to liquidate and appoint a Licensed Insolvency Practitioner. Click on this box to read the step by step guide of what happens.
COMPULSORY Liquidation
This is usually where the company is forced into liquidation by an unpaid creditor and the Court decides to wind the company up and appoint a Liquidator.
Members Voluntary Liquidation
This is the process used to close a solvent business usually to save tax. We can usually pay out the shareholders within 7 days and the fees are fixed.
David Kirk
Kirks Insolvency
David qualified as a Chartered Accountant in 1990 and Licensed Insolvency Practitioner in 1996. David will give you clear and plain language advice about your business’s options and make a recommendation of which route he thinks will work best for you.
★ ★ ★ ★ ★
“Everything went smoothly and professionally”
We have just had the pleasure of working with Kirks, to complete the closure of my company, everything went smoothly and professionally. I would recommend this company and the staff very very helpful and quickly finalised everything. Thank you Kirks.
Carol Hill
Business owner
WHy use Kirks
Testimonials
